Lithuania crypto license
Lithuania has created almost ideal conditions for launching fintech business. The Central Bank supports the development of financial technologies and non-bank payment services. Also created a favorable environment for the development of fintech startups, and simplified the procedure for obtaining licenses. Over the past year, the number of fintech companies has increased by 40%, and the interest in the Lithuanian market is shown by large international players.
Although Lithuania does not have a comprehensive legal framework for dealing with cryptocurrencies, it has introduced licensing of cryptocurrency exchange companies and maintenance of cryptocurrency purses, becoming one of the few European Union states, with the procedure of licensing and authorization of the new virtual currency.
In Lithuania, it is possible to obtain two types of licenses to work with cryptocurrency:
- Crypto Exchange License (Crypto Exchange License). The company or branch of the company, gets the opportunity to engage in the exchange of digital currency, receiving a commission.
- Crypto Wallet Exchange (Crypto Wallet Exchange) License. In this case, the company or branch of the company can manage client wallets for cryptocurrency storage.
The Lithuanian Central Bank insists that the activities of traditional financial institutions and cryptocurrency companies be separated. In this case, virtual assets can be in the circulation of traditional market players. Applications for obtaining crypto licenses in Lithuania can be submitted by companies or subsidiaries of companies that are both residents and non-residents of the EU. In order to prevent the legalization of the proceeds of crime, the activities of crypto operators are controlled by the relevant legal institutions. Board members as well as owners of the company must meet the requirements of impeccable reputation, such as no criminal record.
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Benefits of Crypto Exchange License and Wallet in Lithuania
- Minimum procedural requirements.
- Low cost.
- Min. investment capital at incorporation of the company – 2,500 euros.
- There are no restrictions on the residency of directors and shareholders.
- Remote registration of the company in Lithuania is allowed.
Companies operating in the cryptocurrency market are required to:
- All clients must undergo verification and identification;
- Records and records of customer data should be maintained;
- mandatory introduction of internal control procedures;
- an officer responsible for compliance with the policy on countering legalization – proceeds of crime (AML Policy) must be appointed;
- Reporting to the Lithuanian Regulator (Financial Crime Investigation Service) is mandatory.
Taxation of crypto companies in Lithuania
Taxation of transactions in cryptocurrency depends on the nature of the transaction. In general, the following taxes can be applied:
- Crypto exchange is not subject to VAT.
- Corporate profits are taxed by 15% (CPN = 15%). Small businesses with less than 10 employees with annual incomes of less than 300,000 euros pay CPN rates of 0-5%.
- The tax on dividends is 15%.
If you want to get a Lithuania crypto license, it will be useful to know that no special reporting to the regulator is required, but FCIS can always make instructions and requests about the activities of the crypto company.